Overview and Analysis of the Overall Welfare System in the UK - Essay Example

?Introduction The overall welfare system in UK is considered as one of the leading welfare systems in the world owing to the fact that it has been able to serve the State and its citizens since last many years. Over the period of time, there have been many changes and amendments in the way system has evolved. United Kingdom as a welfare state is based upon three fundamental elements of guaranteeing a minimum standard of living with a minimum level of income, social protection in case of any insecurity and provision of services at the best level. These fundamental elements therefore guarantee that the system as such remains intact and is based upon universal principles. Due to current economic crisis faced by UK specifically and other developed countries, there has been a greater emphasis however, on to reform the welfare system of the country. Considering the high fiscal deficit incurred by the government and extra burden put by the welfare expenses, the current efforts by the government to radically reform the system therefore are based upon reducing the fiscal burden and further rationalize the welfare system. UK however, is currently being ruled through a coalition government with Conservatives and Lib Dems at the helm of the affairs. The coalition nature of the government therefore is making it tough for David Cameron to actually not to get a free hand in making radical changes in the overall reform system of the country. This paper, drawing on the theories from Politics and Sociology, will discuss how the coalition government is reflected in the current reforms efforts by David Cameron. Welfare State as a Concept A welfare state as a concept involves active and key involvement of government in ensuring the economic and social well-being of the citizens of the state. Based on certain principles such as equality of opportunities and equal distribution of wealth, a welfare state aims at providing minimum standards of life which can be maintained for those who otherwise cannot do so on their own. As such, welfare state as a concept requires formation of institutions and policies which requires a government to take certain steps to achieve the policy objectives. (Rothstein, 1998)  Welfare states therefore involve themselves in transfer of funds for the services provided as well as to the individuals. The expenditure of government on the welfare is often done through redistribution of taxation i.e. what government earns through the levying taxes. Esping-Andersen outlined three ways around which a welfare state can be developed i.e. social democratic, conservative and democratic. Social democratic welfare is considered as an idealistic welfare state because of its universalism appeal. Accordingly, a social democratic welfare state is based upon providing universal access to benefits and services based on the citizenship of the individuals. (Esping-Andersen, 1990)  The liberal regime however, is based upon dominance of market and private provision- the overall involvement of state is only limited to the provision of basic needs which too are often mean-tested. Social stratification therefore is relatively high under the liberal regime and decommodification of state benefits is considered as low. United Kingdom as a Welfare State The history of reforms in UK dates back to first decade of 20th century when serious efforts were taken to bring in changes in the Way State actually responded to the needs of its citizens. Liberal Welfare Reforms were first introduced during 1906-1914 when Labor Party of the country introduced a series of social legislations. It has been argued that the establishment of UK as a modern welfare State started with these reforms. These reforms also showed a change in the way Labor Party politically aligned itself and advocated for more active role of government in the welfare of citizens. During these reforms many important legislations such as National Insurance Contribution, free school meals, Old Age Pension act as well as the Development Act were enacted by the government. These reforms therefore set the basis for the establishment of a modern welfare state in UK. Over the period of time, the welfare state reforms were restructured and modified in order to improve the role of non-governmental organizations in the whole process. These efforts were made at improving the overall delivery of the welfare benefits besides bringing in more transparency and efficiency in the way welfare was carried out. It is however, important to understand that high welfare has its cost also and the current economic crisis has actually exposed the vulnerability of the State to retract from the promise welfare benefits because of the overall cost involved in managing and delivering such benefits. Current Reforms The current reforms Bill of David Cameron is focused upon reducing the welfare dependency and is considered as the most important radical restructuring of the system as a whole. The whole idea of the current reforms is based upon the assumption of discouraging the culture of benefits wherein people thrived upon benefits rather than using the same under given conditions. The new reforms therefore seem to be focused on encouraging people to work more and live less on reforms. The current reforms therefore are based upon discouraging people to accept benefits as a viable alternative to work. The most important change brought about by the current reforms is the capping of the total benefits a family can enjoy. Accordingly, new reforms caps the total benefits to the limit of ?26,000 per year while at the same time introducing restrictions on the number of long term benefits which can be availed. The current benefit system involves an array of different benefits which however been replaced with a universal credit. This step is considered as a step towards achieving more efficiency as well as lowering cost for the government to administer the whole welfare regime. Further steps have been taken to rationalize child credit schemes as well as tax credits given to low income earning families. What is however, important to understand that despite taking a very radical view about housing during the emergency budget, government has done little to introduce reforms in this area due to some political issues related with the coalition partner of the government? Housing Reforms and Coalition Government One of the key proposals for bringing in the reforms in housing sector was to cut the benefits for 10% however, due to the intervention of Nick Clegg, Deputy PM and the head of the coalition partner of conservative party, government was not able to implement such change. Nick Clegg intervened for not reducing the housing benefits by 10% to the long term unemployed individuals and families. One of the key arguments by the coalition partner of the government was based upon the assumption that the private landlords may not rent out their properties to the unemployed if they fear that their income will be reduced due to cut in the housing benefits. There has been intense debate and disputes between the coalition partners on how to actually reform the social housing sector of the country as both parties seem to pursue their own political agenda. Recently, Nick Clegg has publically suggested that he will air his differences with the coalition government so that people should have a clear view of the stand taken by his party on different issues. (Watt, 2011)  This act has been seen as an effort to actually create a distinct and separate identity for his party and to dilute the impression that his party has not done enough to voice against different unpopular moves of David Cameron’s government. His opposition to the social housing reforms therefore is also seen an step in this direction. One of the key arguments in favor of coalition government is based upon the assumption that coalition governments leads to a consensus-based politics. (Sundquist, 1989). Consensus based politics often requires agreement of major partners in power sharing formula at the center of the government. Such governments are often formed during the times of national crisis however; UK has witnessed coalition governments albeit during the recent labor government. The current coalition government broke the hold of 13 years rule of Labor Party however it was only done when Lib Dems and Conservatives formulated the coalition government. Housing Reforms which have been one of the key policy issues for Conservative Government since it came into power however faced tough and stronger challenge from its coalition partners. During the current reforms bill, government attempted to introduce some radical changes in the social housing market however as much as 13 Lib Dems voted against the move thus clearly suggesting that coalition partners may not be ready on certain issues. (Wintour, 2011). The argument of developing and building a consensus in a coalition government therefore may not hold in current scenario. It is however, important to note that Lib Dems have supported various other policy reforms of the government and took active part in ensuring that mutually agreed policies are implemented. At the time of formation of the agreement for coalition government, both the parties agreed to adhere to certain policy formulations however, it now seems that the differences may clearly emerge between the two parties. (Dailymail.co.uk 2010)  Issue of Political Identity It has also been argued that Lib-Dems may merge with the Conservatives in upcoming elections and Lib-Dem as a party may lose its very own identity. However, considering the opposition of certain reforms proposed by the conservative government, it now seems that Lib-Dems may be willing to keep their own separate identity while at the same time negotiating and brokering for political power in the government. Many argue that there is a clear shift in tactics of both the parties as Lib-Dems now considerably see themselves as a third political power in the country. Nick Clegg’s strong opposition to some of the aspects of the social housing reforms therefore is one of the clear indications of how the coalition government actually differing on certain key issues. It is also important to understand that both the parties have their own separate political philosophies and ideologies therefore their merging may clearly reduce the number of alternative political voices in UK. One of the key arguments in favor of coalition government is also based upon the assumption that a coalition government reflects popular opinion about electoral in country. (Austen-Smith, and Banks,2005) This argument is however, based upon the diversity of views and popular opinion about different issues. Lib Dems opposition for social housing reforms within the country therefore can be of the satisfactory arguments to reflect upon a popular opinion about the proposed reforms of the government. Since current reforms reduced the benefits therefore popular opinion is not in favor of such moves by the government. Politically, Lib-Dems may face a certain death if they continue to support unpopular moves by Conservative government. Current reforms are feared to reduce the disposable income for many families thus reducing the overall options and choices for families. Lib-Dems therefore seem to capitalize on these political sentiments to carve out a separate identity for itself which it can cash on in next elections. (Wintour, 2012)  Conclusion Welfare State as a concept is based upon the notion that the government should active part in the economic and social well-being of the citizens. UK has a long history of making its journey towards one of the finest welfare states in the world. However, current economic crisis has exposed certain vulnerabilities of the reform system of the country and how it may have an impact on its fiscal stability. Considering the threat posed, the current government of David Cameron- a Coalition government, proposed radical changes in the way current reform system of the country is formulated. Though its coalition partners have agreed on many of its reforms however on the issue of social housing, Lib-Dems, the coalition partners of the government, have shown open dissent. Many argue that it has been due to the fact that Lib-Dems want to keep their own identity alive and want to emerge as a third stronger political force in the country. Politically, the current coalition agreement of Lib-Dems may prove as a death nail for the party if they continue to support the unpopular moves of Conservative Government. References Austen-Smith, D. and S. Banks, . (2005) Positive political theory II: strategy and structure. Michigan: University of Michigan Press Dailymail.co.uk (2010) Lib Dems furious over Cameron's council house plan to end life tenancies | Mail Online. [Online] Available at: http://www.dailymail.co.uk/news/article-1300462/Lib-Dems-furious-Camerons-council-house-plan-end-life-tenancies.html [Accessed: 28 Mar 2012]. Esping-Andersen, G. (1990) The three worlds of welfare capitalism. New York: Princeton University Press,. Rothstein, B. (1998) Just Institutions Matter: The Moral and Political Logic of the Universal Welfare State. New York: Cambridge University Press,. Sundquist, J. (1989) Needed: A Political Theory for the New Era of Coalition Government in the United States. Political Science Quarterly, 103 (4), p.613-635. Watt, N (2011) Nick Clegg plans to air differences within the coalition government | Politics | The Guardian. [Online] Available at: http://www.guardian.co.uk/politics/2011/jan/11/nick-clegg-differences-coalition-government [Accessed: 28 Mar 2012]. Wintour, P. (2011) Housing benefit cuts defeated by House of Lords in welfare reform vote | Society | The Guardian. [Online] Available at: http://www.guardian.co.uk/society/2011/dec/14/housing-benefit-cuts-lords-defeat [Accessed: 28 Mar 2012]. Wintour, P. (2012) Liberal Democrats voice fears on housing benefit reform | Society | The Guardian. [Online] Available at: http://www.guardian.co.uk/society/2012/jan/14/liberal-democrats-housing-benefit-reform [Accessed: 28 Mar 2012]. Read More